@Sakura please summarize this article, thanks uwu.
TLDR
Crypto tools can help founders bootstrap networks and overcome the “cold start problem” by using financial incentives, piggybacking on existing networks, and leveraging zero-knowledge proofs to port user data and reputation.
Key Points
- Platforms with network effects are hard to displace, but can be bootstrapped using:
Financial incentives (e.g. Uber driver referrals, PayPal sign-up bonuses)
Piggybacking on existing networks (e.g. Facebook, Aadhar)
Zero-knowledge proofs to port user data and reputation (e.g. Uber driver ratings, Amazon reviews) - Crypto networks can use token incentives and open data to bootstrap, but face risks of “vampire attacks”
- zkTLS is a new cryptographic tool that allows users to permissionlessly share verified data about themselves, empowering new networks
In-depth Summary
The article discusses how crypto tools can help founders bootstrap networks and overcome the “cold start problem” - the challenge of building a valuable platform with few initial users.
It starts by explaining how platform businesses with network effects have become dominant, but are difficult to displace once established. Traditional approaches to bootstrapping include using financial incentives (e.g. Uber driver referrals, PayPal sign-up bonuses) and piggybacking on existing networks (e.g. Facebook, India’s Aadhar system).
The article then explores how crypto networks can use token incentives and open data to bootstrap, but face risks of “vampire attacks” where new entrants lure away users and liquidity. It highlights the emergence of open, transparent networks like Farcaster that allow developers to build on top of them.
A key innovation discussed is zero-knowledge proofs, specifically zkTLS, which allows users to permissionlessly share verified data about themselves (e.g. Uber driver ratings, Amazon reviews) with new networks. This empowers founders to bootstrap curation and overcome the “chicken and egg” problem.
The article concludes by arguing that the current era of digital servitude, where users are locked into dominant platforms, will eventually give way to a new generation of platforms that empower users with better tools and more control over their data.
ELI5
Imagine you’re starting a new taxi company and need to get both drivers and passengers to use your app. It’s really hard to get people to join at first because your app isn’t very useful without a lot of users.
Crypto tools can help you solve this “cold start” problem in a few ways:
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You can give drivers and passengers money or tokens to join and invite their friends. This gets the ball rolling.
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You can let people use their accounts and reputations from other apps like Facebook or Uber. This makes your app more useful right away.
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You can use special crypto tech called “zero-knowledge proofs” to let people securely share info about themselves, like their Uber rating, without revealing everything. This helps build trust in your new app.
The key is using these crypto tools to bootstrap your network of users, so it becomes valuable enough for the “network effect” to kick in - where more users make the app even more useful. This helps new platforms compete with the big tech giants that currently dominate our digital lives.
Writer’s Main Point
The main point of the article is that crypto tools provide powerful new ways for founders to bootstrap networks and overcome the “cold start problem” that has historically favored incumbent platforms. By using financial incentives, piggybacking on existing networks, and leveraging zero-knowledge proofs, new platforms can build valuable networks and compete with the current era of “digital servitude” under dominant tech giants.